Nifty Review of the market movement. Analysis of Options data

Here is a quick update on what on the trading charts that we have discussed two days back. It was spot on swing trade with respect to that level. Let us discuss what is in store for the upcoming sessions.

The other day we posted that Nifty Future has resistance around 5960 levels. We mentioned that all pullbacks to that level will be shorted.  Nifty on 24^th September made a high of 5962. We also mentioned that Downside target emerges at 5810-40 zones. Market today found support at 5820 and retraced back from there.

Our swing traders were short at the break of the 5960 levels and exited at 5840 just in line with the trading levels posted.

Immediate hurdle lies now at 5905 levels and trading above that markets will try to retrace back to the trading levels of 5960 on the upside. On the downside it will be better to try pull back trades on dips with stops at 5810 levels.

Fresh short trades will again be active in case Nifty future manages to close below 5800 trading levels.

Here is also an analysis and review of what the options data are suggesting since we are nearing expiry options accumulation along with price point analysis provide good levels for low risk pull back opportunity and some fantastic break out opportunities.

Here is a look at the options chart:

NIFTY OPTIONS ACCUMULATION- 25 SEP-2013

Nifty has terrific accumulation at 6000 zones.  This suggests that it is the toughest resistance zones. Hence swing traders can look to short on pull back to that trading levels. Similarly support lies at 5700 and 5800 trading levels and this will offer support zones to the market on the downside. A breach of 5800 can trigger a slide to test 5700 levels in a short time.

Nifty Outlook. Where are markets headed. Trading zones at these levels

Nifty futures have corrected sharply for the last few sessions. Some of it was triggered by a news based move and part of it coinciding with classical divergence patterns combined with price point analysis.

Here is a look at what has happened on the charts and where are we headed from here. NIFTY is approaching interesting levels here. Here is a look at the hourly charts of Nifty and an analysis of it.

NIFTY FUT SHORT TERM SWING CHARTS

Nifty has displayed a classical divergence pattern with RSI where RSI failed to make a higher high despite markets moving here. Once it failed to breach 6180 there was a look risk contrarian trade opportunity near that levels.

Since the crash that we witnessed post the RBI news NIFTY has been falling with a descending pattern across a channel. The channel low is now at 5840 zones.

The trading levels of 5840-5810 is also a support range to watch out for . swing wise this will be the key level to watch out for. This may provide a low risk contrarian opportunity.

A breach of that level can lead to a test of 5745 and 5640 on the lower sides. On the upside resistance remains at 5960 trading zones and any pull backs to that level will be resisted.

Only if NIFTY Fut manages to  close above that level can ensure a reversal of the down ward swing and a resumption of the upward move. 

What was Unique About the August series. What Lies ahead For the Markets Now

August series for 2013 was a unique month in lot of ways.  This will also go down as one of the trading outlier months for more reasons than not.

What happened in August that made it unique?

Point No 1: Well for starters markets showed tremendous amount of volatility with more those acceptable volumes. We witnessed major index futures moving to the tune of 5-8% on some of the days. This is something that we don’t hear often in advanced market. Do you remember when was the last time Dow jones or S&P moved to that extend

The interesting part was that we witnessed a gradual downside trend despite this move and more that acceptable volumes.

Point No 2: Most days in August saw a gap up or gap down of 2% plus on the major indices and yet on many days we didn’t see a follow up move on the side of the gap. This is something unusual for major indices. While our markets are known for this. The frequency was staggering.

Point 3: Our long time readers will recall that way back in Jan-Feb 2013 we had written that Weekly ATR was at its all-time lowest value and we should see volatility increasing over the next few months. This is what we exactly saw in the last few months. With Volatility peaking to a unusual high levels in August. This was in expected lines, but at the same time now the daily ATR stands at very high non sustainable limits.

Point 4:   In august thanks to increased volatility we saw India VIX peaking to its highest values since Mart 2011. VIX jumped significantly clearing indicating decreased risk appetite and confidence in the investor segments.

Now what lies ahead for September:

NIFTY FUT CHARTS-2ND SEPT -2013

Since the volatility indicators have deviated significantly chances are they will consolidate here. But even then since they are at such high values we expect a moderate consolidation to come through. This only co relates to the rate of market move and not the market levels.

Trading levels wise Critical swing hurdles lie near 5530 levels and clearing that we are all set to test 5605 levels on the upside. It will be important to see if we manage to close above those zones to indicate any signs of trend reversal on the charts.

While on the downside 5450 and below that 5300 will form a strong base for the series.  From a swing trading point of view it may be good to trade reversal within these zones both at upside and downside and look for a break out trade outside this trading zone.

NIFTY FUT Headed for Interesting Times ahead

NIFTY FUTURE- Review of 23^rd  July and Analysis for 24^th July

Yesterday we discussed that the key trading level on the upside on swing basis remains at 6075 and trading above that can head to 6110 levels. Today we saw markets gap up and move above 6075 in opening sessions. Once markets sustained above that it acted as a support and markets went to head and make a high just below the swing levels at 6107. This NIFTY FUT failed to cross but found multiple support in the 6070-75 zones to manage to sustain and close above it.

This will form as the support in coming sessions and any move below that will make the short term bears active from an intraday point of view. Below that level markets can move to 6035 levels or lower.

On the upside a clear of 6110-15 can mean a massive swing break out and can pull NIFTY FUT all the way up to 6220 trading levels.

On an immediate basis a clear of 6115 can take NIFTY up to 6135 levels and higher.

Why this is interesting is NIFTY today traded in a closed range and a move on either side would mean good high potential low risk opportunities for traders both intraday and swing players.

Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 6115-20  sustaining above which it will target 6135,6165,6220
POWERTRADE TREND DECIDER OF THE DAY ------- 6100-05
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 6070-75
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 6035,6005

How to trade the Expiry Day. Low risk trading ideas for Expiry day

NIFTY FUTURE- Review and Trading Analysis-27th June

NIFTY FUT –   Firstly well isn’t market following a pattern pretty much in line with what we discussed. Refer to our blog charts previously posted. We had marked that the downside targets are near 5580 zones. NIFTY swing wise just marked that low for two consecutive sessions but yet managed to hold onto it on a closing basis. It will be critical to watch out how markets trade around that level and it can provide a very low risk trade opportunity on either side for swing traders. But advise would be to watch out for the expiry to pass by until we see a convincing move.

Since we are looking at expiry the volatility provides some fun trading ideas specially keeping options positions in mind. So let us review what are the option as of today.

The best way to analyze option data is just to have a look at the option accumulation chart. One picture gives in multiple data points in a single view.

June 2013 series-Option OI Data-26th June

<charts attached at www.powertrades.blogspot.com>

So the most evident thing with this chart is the huge CE accumulation at 5700 zones . Also we see significant and distributed PE accumulation at 5500 and 5600 levels. Now our expiry strategy needs to be treat this accumulation has to hold for tomorrow and use price point analysis to find out potential trading zones

Based on this our boundary points more or less are 5570-80 zones on the downside and 5700 on the upside. So to take a low risk entry one should look at sharp pull back trades in rise with stops above 5700 levels and also pull back on upside to trade for a close above 5600 levels. Probably with 5550 as stops. This trade can be taken in sharp dips.

Dear remember expiry day is risky hence risk lower than your usual quantity. Even if you don’t get favorable levels its perfectly fine to stay out and watch. Trade safe

Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 5620-25  sustaining above which it will target 5655,5675
POWERTRADE TREND DECIDER OF THE DAY ------- 5575-80
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 5550-55
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 5530,5505

NIFTY Fut Indicates Strong Reversal Pattern on daily Charts. Detailed Price point and Elliot wave analysis

NIFTY FUTURE- Review of 14 ^th June and Update for 17^th June

NIFTY FUT – marked a strong reversal pattern on the daily charts, typically a island reversal pattern where we witnessed a isolated low being made on the previous day.

With this reversal NIFTY FUT managed to pull back and close at near 5800 levels. Readers will recall from previous posts that 5760 was a strong swing level to watch out for on either side for BULLS and BEARS and this will continue to remain so. On Friday once markets moved above 5760 we saw a strong a continued upmove for the rest of the day as this level then acted as a support.

Now At this level there are two conflicting views as a swing traders and where markets may go from here. One an island reversal typically signals a change in trend and a new trend on the other side. Two at the same time we have seen a strong downmove and typically should see some resistance at retracements.

Check the chart  below which combines price points Elliot waves and Fibonacci retracement analysis to find the next trading level to watch out for.

NIFTY FUT CHART ANALYSIS-16 JUN

As it stands on the upside 5835-40 levels and above that 5870 will be the key hurdles and if we manage to clear that we can see a strong swing reversal pattern confirmation.

On the downside 5750-60 will be the swing support zones and a breach of that can signal a false reversal and lead to strong downside in coming sessions or weeks.

Based on this my idea to trade for a swing trader would be to look to long in retracements with SL and reversal below sustained moves of 5750 or a swing break out long with SL around 5800 if we manage to clear 5870 levels.

From an intraday point of view it is advisable to use the trading levels.

Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 5835-40  sustaining above which it will target 5865,5890
POWERTRADE TREND DECIDER OF THE DAY ------- 5800-05
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 5755-60
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 5730,5690

NIFTY FUT fails to clear our swing Hurdles. Project NIFTY Fut movement with accurate price point analysis

NIFTY FUTURE- Review of 10^th June

NIFTY FUT – Despite of a positive opening due to global cues market could not stay positive for more than 30 min of opening. As the market fell below the TREND DECIDER as mentioned at 5935 it just couldn’t  manage to hold above the level to make the positive trend. Market made a free fall to get some support at primarily at 5901 then finally getting support at 5890 levels at first half of the day, which we yesterday mention as the BULLS LAST POINT OF THE DAY.

Huge selling was been noticed during the last 45 min of trade when Rupee made its all time low of 57.95 per dollar. Nifty today made a lower low to 5867 but BEARS couldn’t manage to kept it below 5890 on a closing basis.

 We had discussed yesterday that 5855 trading level will be the key trading on a swing basis.

 For three consecutive sessions despite managing to breach below 5890 NIFTY has managed to pull back and close above that level.  Will we see a pull back from here or a breach of the swing trading levels. Read our analysis for the next session

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NIFTY FUTURE- 11^th Jun Trading Guide

NIFTY FUT despite having managed to breach the trading levels of 5890 have managed to close above that in three consecutive sessions. The trading levels of 5850-55 are critical levels on the downside to watch out for.

On an immediate basis 5885-5890 still remain the support level but if break below we can see selling pressure intensifying. In that case NIFTY Fut which can move it again to the 5860 level where again we can see some support to emerge.  Breaking of 5855 can move the market to the low of 5830 level.

   On the upside 5935-5940 remain the immediate resistance on a swing basis and a long trade can be taken above it  with tight stops for the 5960 and higher levels where we can see some sort of resistance. Above 5965 level we may again see on a intraday move to 5990 then to 6005 level. Else this level of 5935 or at 5965  might provide good contrarian pull back trading opportunities.

Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 5955-60  sustaining above which it will target 5990,6030
POWERTRADE TREND DECIDER OF THE DAY ------- 5920-25
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 5885-90
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 5860,5835

NIFTY FUT clings to the critical support zone. Will it be decisively broken?

NIFTY FUTURE- Review of 4^th June

NIFTY FUT – gave a perfect day to trade to the traders as per the trading levels. Simply trading as per levels would had yielded two good trades. Let review them.

What were the trading levels for this trading session?

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 5990-95 

POWERTRADE TREND DECIDER OF THE DAY ------- 5960-65

As traders we also knew that 5935 is a crucial swing support zone, in the morning a long trade opportunity was created once NIFTY FUT managed to move above the 5965 trading levels. This created a trading opportunity to test higher levels upto the Trend decider. Just the perfect recipe for a day trader. High made was at 5994.90… probably a bit of a co incidence ( Just a trend decider) But the fact is that the trading level got respected.

This was the second trade opportunity that was created a contrarian short at those levels or a confirmed short on break of the TREND decider for the downside levels of 5935 and lower.

Idea here is again to trade as per the trading levels and be objective about the trading. We need to strict to the trading levels and combine them with swing support and resistance levels to device the trade plan for the day.

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NIFTY FUTURE- 5^th Jun Trading Guide

NIFTY FUT barely managed to hold on and trade as per the trading levels of 5935  almost marking identical lows below that trading level at above 5920 trading zones.  The fact that it managed to pull back and close above the this trading level goes on to signify how important this level has been swing wise.

On an immediate basis 5925-30 will be a crucial trading level to watch out for and a breach of that can see a slide till 5890 levels and lower. On the upside NIFTY Fut will be resisted on all rise upto 5965 levels and above that while we may not see some momentum but may see NIFTY trading more in a choppy manner.

On a swing basis We may see some real momentum for the BULLS  only if NIFTY FUT manages to surface above 6005 levels and that  may signal a reversal in trend. Swing wise on the downside 5890 will be a crucial level to watch out for. This will be important to watch out for in the coming sessions incase 5935 is breached.

Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 5995-6005  sustaining above which it will target 6035,6065
POWERTRADE TREND DECIDER OF THE DAY ------- 5960-65
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 5930-35
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 5890, 5855

NIFTY FUT tests 5930. Why is it important to watch out these levels

NIFTY FUTURE- 4^th June Trading Guide

NIFTY FUT quite a lot has changed since we posted few days back. We had mentioned that 6030 will be a crucial swing level to watch out for and long time readers will recall that the projected targets below these were mentioned as 5990 and 5950 levels.

Today NIFTY FUT tested 5930 trading levels and barely managed to sustain those trading levels. The last time these levels were tested on 24^th May (Refer to our posts around that time) we had mentioned that this was a terrific low risk pull back opportunity and we saw a serious bounce from those levels to about near 200 points.

Today NIFTY FUT marked a low just there and managed to pull back to close at around 5960 trading levels. With the current close NIFTY FUT will face immediate resistance around 5980-90 trading levels and clearing and sustaining above these trading levels can lead to a test of 6035 zones which should form as a serious hurdle going forward. On the downside 5935 will be a crucial level to watch out for and if NIFTY FUT manages to crack this level we can see another round of downside movement to test 5890 and 5855 odd levels on the downside.

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Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 5990-95  sustaining above which it will target 6030,6065
POWERTRADE TREND DECIDER OF THE DAY ------- 5960-65
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 5930-35
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 5895,5855

NIFTY FUT consolidates, Swing levels remain intact. Trading NIFTY at these levels.

NIFTY FUTURE- Review of 29^th May

NIFTY FUT –   Let us quickly recap two things that we discussed yesterday. 1. We mentioned that

“6050 levels will again form as the crucial support and in case NIFTY FUT breaches that level we can see a change in mid term trend too.”  Today NIFTY FUT marked a low just above that zone at 6050 and managed to pull back sharply to just hit the  TREND DECIDER of the day at 6090.

We may also note that the BULLS LAST Stand point discussed was at 6050-55. This is again exactly where low was marked in NIFTY FUT today. Is it magic. No its simple price point analysis of the trading levels.

We also mentioned that below 6090 NIFTY FUT will trade in a lack lusture manner this is exactly what happened again when NIFTY FUT moved below 6090 trading levels. How did we trade the day.

NIFTY FUt consolidated within the trading range and managed to hold on to the support levels  and at the same time failed to cross the swing hurdles. How to trade NIFTY FUT from these levels. Let us analyze in our trading session for tomorrow.

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NIFTY FUTURE- 30^th   May Trading Guide

NIFTY FUT  closed at a crucial trading levels of 6085 , this is pretty much trading within the range created in the previous session.  In fact NIFTY FUT also made identical lows for the past two trading session.

Based on that 6050-55 will form as the  crucial support zone again and trading below that level now may lead to a test and break of 6030 to hit lower target zones of 5990-6000 trading levels.

On the upside 6085-90 will form as the form as the TREND Decider again and we can see a bullish nature emerging once NIFTY FUT manages to trade above this range. Crucial swing wise break out will emerge once NIFTY FUT manages to trade above 6115-6120 trading levels. Safe trading looking to initiate longs may wait for a clear of this trading level.

IF NIFTY manages to clear this level, then we may see more traction on the upside trading levels. The next hurdle above this level lies at 6150 trading levels and if it manages to clear that then we can see a straight dash to 6200  6220 trading zones on the upside.

Since the trading range remains the same, more or less the trading levels too remain intact.

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Trading levels for the day:

POWERTRADE BEARS LAST STAND POINT OF THE DAY ----- 6115-6120  sustaining above which it will target 6155,6198
POWERTRADE TREND DECIDER OF THE DAY ------- 6085-90
POWERTRADE BULLS LAST STAND POINT OF THE DAY------- 6050-55
Breakdown and sustaining below POWERTRADE BULLS LAST STAND POINT OF THE DAY will open target for support of ---- 6030,5990